Is Empire Blue Cross Of New York QuittingThe Business? Empire Blue Cross Of New York notified NY small business health insurance reps it’s reducing the amount of health insurance programs it offers to little groups starting April 1, 2011.
However Empire Blue Cross Of New York also told NY small business health insurance agents that is is cutting their commissions significantly. While Empire Blue Cross Of New York has stated they’re not getting out of the NY small business health insurance market, they do exactly that.
Effective April 1, 2011 Empire Blue Cross Of New York is ending the Empire EPO Stepped, Empire EPO Essential Options 1 “9, Empire Point of Service, Empire PPO Plus, Empire Total Blue PPO with Health Savings Account, Empire Prism EPO and Value EPO.
This is not the 1st time an insurance company dropped coverage for the small market. Early on in the year Emblem Health dropped its HSA program. Read the NY small business health insurance story.
Except for slashing the quantity of NY small business health insurance programs that Empire offers, Empire Blue Cross Of New York is reducing the insurance agent’s commission from 4% to a flat fee of $5 for each policy holder every month.
It seems that insurance companies can’t make any cash in the NY small business health insurance market. Since 2006, a number of insurance companies have dropped out of the NY small business health insurance market. With other companies have similar issues, how long will it be before other insurance companies also start chopping plans and lowering commissions?
Lowering commissions seems like a great plan as it might save the insurance company money and that savings might be offered to the policy holder in the form of premium reductions. However instead of trying to stay competitive in the market, firms like Empire Blue Cross Of New York are limiting commissions and raising prices. Corporate gluttony at its finest.
With Empire Blue Cross Of New York no longer desiring to be competitive, this leaves NY small businesses with only three plans; Oxford, Emblem, and Aetna. Finally you will wake up in the morning and have only 1 option in the New York market. I speculate what it’s going to be?
If you think this is an issue that is limited to the New York health insurance market, you are wrong. Cutting options and raising premiums is coming to a health plan near you.